RBI aims to provide financial services in all rural areas

RBIAn RBI committee has told the private sector banks to extend their financial services to rural areas and promote the cause of financial inclusion.

The Committee, headed by Usha Thorat, RBI Deputy Governor, aimed to provide financial services to all rural areas by March 2011. The committee also proposed that a roadmap may be drawn to render banking services in any form to all villages with a population of more than 2000 by March 2011.

The committee also stated that the state governments should assure road and digital connectivity to all the centers where penetration by the formal banking system is needed.

Further, committees urged to expedite use of IT solutions for disbursement of National Rural Employment Guarantee Act (NREGA) and social security payments and widen support to banks in retrieving their dues.

The high-level committee was established by the RBI to better the effectiveness of the Lead Bank Scheme with stress on financial inclusion and latest growth in the banking sector. Members of the high-level committee include Chief Secretaries of States, Chairman of major public sector banks and others. The high-level committee on August 20, 2009, presented its final report to the Governor of Reserve Bank of India.